Retirement Plans Exempt in Bankruptcy
- January 10, 2013
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Annuities and other qualified retirement plans are exempt in bankruptcy in order to permit debtor the opportunity to be self-supporting upon retirement rather than relying on government programs for support. The key component to keeping the asset is whether the plan is a qualified retirement plan. A bankruptcy trustee may object to exemptions but only upon providing sufficient evidence rebutting the presumption of validity of the exemption. Section 522(d)(10)(E) of the U.S. Bankruptcy Code sets forth the requirements for the plan as follows: (1) debtor’s right to receive payment is on account of age, and (2) the amount to be exempted is reasonably necessary for the debtor’s support. If these requirements are met, there is a presumption of validity and the debtor will be able to retain the asset. If you are considering bankruptcy, you should consult an experienced attorney immediately in order to protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.